And there’s something pretty significant buried in the details of Obama’s mortgage relief plan:
The federal government has doubled the size of its commitment to Fannie Mae and Freddie Mac, increasing the guarantee against losses on their mortgage investments to $400 billion.
The massive expansion of this public backstop for the troubled mortgage giants was disclosed this morning among the details of the Obama administration’s plan to reduce foreclosures.
Fannie Mae and Freddie Mac were seized by the government in September to stabilize their role as the main source of funding for the mortgage lending industry. The government pledged up to $200 billion to cover the companies’ losses, but officials said at the time they did not expect the companies to need that much help.
The two companies have since estimated that they will need up to $65 billion to cover their losses in 2008 alone, as economic deterioration drives more borrowers to default.
And the cost of the bailout just keeps piling up.
Heads up for A Chicago Tea Party in July. Rick Santelli has a great idea- take it to the spenders whre they live-in the meadia-the drive bys need it taken to them.